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Tax incentives for Forest City Special Financial Zone Gazetted – Part 2

13 October 2025

As mentioned in Part 1 of our 3-part article, the Malaysian Government gazetted eleven pieces of subsidiary legislation relating to Pulau 1 of the Forest City Special Financia Zone1 (“Pulau 1 FCSFZ”) on 3 October 2025. The name of each subsidiary legislation and their respective commencement date or effective period are set out in the Table in Part 1.
 
In Part 2, we will provide a summary of the main requirements under P.U.(A) 353/2025, P.U.(A) 354/2025, P.U.(A) 355/2025 and P.U.(A) 356/2025 which relate to remission of stamp duty for the purchase and financing of residential and commercial units in Pulau 1 FCSFZ.
 
We have provided a summary of the salient points of P.U.(A) 350/2025, P.U.(A) 351/2025 and P.U.(A) 352/2025 in Part 1, whilst the salient points of P.U.(A) 357/2025, P.U.(A) 358/2025, P.U.(A) 359/2025 and P.U.(A) 360/2025 are covered in Part 3. Parts 1 and 3 can be accessed here and here.
 
P.U.(A) 353/2025 – Remission of stamp duty for financing of property purchased by individual in Pulau 1 FCSFZ
 
Remission of stamp duty
 
Paragraph 2(1) of P.U.(A) 353/2025 provides for a 50% remission of the stamp chargeable on any instrument of loan or financing agreement for the purchase of a residential unit or commercial unit in Pulau 1 FCSFZ executed between one or more individuals and any of the following entities: 
  1. a licensed bank under the Financial Services Act 2013 (“FSA”);
  2. a licensed Islamic bank under the Islamic Financial Services Act 2013 (“IFSA”);
  3. a development financial institution prescribed under the Development Financial Institutions Act 2002;
  4. a co-operative society registered under the Co-operative Societies Act 1993;
  5. Borneo Housing Mortgage Finance Bhd (Co. No. 25457-V); or
  6. Mutiara Mortgage & Credit Sdn Bhd (Co. No. 257663-T). 
Conditions for remission
 
The instrument of loan or financing agreement referred to in paragraph 2(1) of P.U.(A) 353/2025 is subject to the conditions set out in paragraph 2(2), namely: 
  1. the sale and purchase agreement of the residential unit or commercial unit (“SPA”) is executed between a developer and one or more individuals;
  2. the SPA is executed from 1 September 2024 to 31 December 2034;
  3. the SPA relates to a residential unit or commercial unit the construction of which is completed before 1 September 2024; and
  4. the SPA must not relate to a residential unit or commercial unit where a sale and purchase agreement for the same unit had been executed before 1 September 2024 and was subsequently cancelled by the same individual. 
Compliance with the conditions mentioned above shall be verified by the Iskandar Regional Development Authority2 (“IRDA”).
 
Effective period
 
P.U.(A) 353/2025 is effective from 1 September 2024 to 31 December 2034.
 
P.U.(A) 354/2025 - Remission of stamp duty for transfer of property purchased by individual in Pulau 1 FCSFZ
 
Remission of stamp duty
 
Paragraph 2(1) of P.U.(A) 354/2025 provides for a 50% remission of the stamp duty chargeable on any instrument of transfer for a residential unit or commercial unit in Pulau 1 FCSFZ executed between a developer and one or more individuals.
 
Conditions for remission
 
Paragraph 2(2) of P.U.(A) 354/2025 sets out the conditions that the instrument of transfer for the SPA is subject. These conditions are identical to those set out in paragraph 2(2) of P.U.(A) 353/2025 (see above).
 
Compliance with the conditions specified in paragraph 2(2) of P.U.(A) 354/2025 shall be verified by the IRDA.
 
Effective period
 
P.U.(A) 354/2025 is effective from 1 September 2024 to 31 December 2034.
 
P.U.(A) 355/2025 - Remission of stamp duty for financing of property purchased by qualifying person in Pulau 1 FCSFZ
 
Remission of stamp duty
 
Paragraph 2(1) of P.U.(A) 355/2025 provides for a 50% remission of the stamp duty chargeable on any instrument of loan or financing agreement for the purchase of a residential unit or commercial unit in Pulau 1 FCSFZ executed between a qualifying person and any of the entities specified in paragraphs 2(1)(a) to 2(1)(f) of P.U.(A) 355/2025. These entities are identical to those set out in paragraphs 2(1)(a) to 2(1)(f) of P.U.(A) 353/2025 (see above).
 
Qualifying person
 
For the purposes of paragraph 2(1) of P.U.(A) 355/2025, a qualifying person is any of the entities as prescribed in paragraph 2(4), namely: 
  1. a person licensed under section 10 of the FSA or section 10 of the IFSA;
  2. a holder of a Capital Market Services Licence under the Capital Markets and Services Act 2007 (“CMSA”);
  3. a recognised market operator registered under section 34 of the CMSA other than an individual;
  4. a person registered under section 76 of the CMSA other than an individual;
  5. a capital market services provider registered under section 76A of the CMSA other than an individual;
  6. a single family fund company as verified by the SC;
  7. a financial technology company, insurance technology company, regulatory financial technology company or Islamic financial technology company which has been awarded MSC Malaysia Status or Malaysia Digital Status as verified by Malaysia Digital Economy Corporation Sdn Bhd (“MDEC”);
  8. a payment system operator established or incorporated in a foreign jurisdiction approved under section 11 of the FSA or section 11 of the IFSA to operate a payment system in Pulau 1 FCSFZ; or
  9. a centralised services entity providing financial global business services which has been awarded MSC Malaysia Status or Malaysia Digital Status as verified by MDEC. 
For the purposes of paragraph 2(4)(f) of P.U.(A) 355/2025: 
  1. a “single family fund company” is a company which is (i) incorporated under the Companies Act 2016 (“CA”) and resident in Malaysia; (ii) wholly owned, directly or indirectly, by a member of a single family; and (iii) established solely for the purpose of holding the asset and investment activity for the interest of members of a single family; and
  2. a “single family” is a family whose members are individuals who are lineal descendants of a single ancestor and includes: (i) the spouse; (ii) the biological child; (iii) the stepchild; and (iv) the child adopted in accordance with any written law. 
Conditions for remission
 
The instrument of loan or financing agreement referred to in paragraph 2(1) is subject to the conditions set out in paragraph 2(2) of P.U.(A) 355/2025, namely: 
  1. the sale and purchase agreement of the residential unit or commercial unit (“SPA”) is executed between a developer and a qualifying person;
  2. the SPA is executed from 1 September 2024 to 31 December 2034;
  3. the SPA relates to a residential unit or commercial unit the construction of which is completed before 1 September 2024; and
  4. the SPA must not relate to a residential unit or commercial unit where a sale and purchase agreement for the same unit had been executed before 1 September 2024 and was subsequently cancelled by the same qualifying person. 
Compliance with the conditions specified in paragraph 2(2) of P.U.(A) 355/2025 shall be verified by the IRDA.
 
Effective period
 
P.U.(A) 355/2025 is effective from 1 September 2024 to 31 December 2034.
 
P.U.(A) 356/2025 - Remission of stamp duty for transfer of property purchased by qualifying person in Pulau 1 FCSFZ
 
Remission of stamp duty
 
Paragraph 2(1) of P.U.(A) 356/2025 provides for a 50% remission of the stamp duty chargeable on any instrument of transfer for the purchase of a residential unit or commercial unit in Pulau 1 FCSFZ executed between a developer and a qualifying person.
 
Qualifying person
 
For the purposes of paragraph 2(1) of P.U.(A) 356/2025, a qualifying person is any of the entities set out in paragraph 2(4) of P.U.(A) 356/2025. They are identical to the qualifying persons set out in paragraph 2(4) of P.U.(A) 355/2025 (see above).
 
The phrases “single family fund company” and “single family” in paragraphs 2(5) and 2(6) of P.U.(A) 355/2025 are applicable to paragraph 2(4)(f) of P.U.(A) 356/2025.
 
Conditions for remission
 
Paragraph 2(2) of P.U.(A) 356/2025 sets out the conditions that the instrument of transfer is subject. The conditions are identical to those set out in paragraph 2(2) of P.U.(A) 355/2025 (see above).
 
Compliance with the conditions specified in paragraph 2(2) of P.U.(A) 356/2025 shall be verified by the IRDA.
 
Effective period
 
P.U.(A) 356/2025 is effective from 1 September 2024 to 31 December 2034.
 
 
Article by Sheba Gumis (Partner) and Joey Tiw (Senior Associate) of the Corporate Practice of Skrine.
 
 
 
1 Pulau 1 FCSFZ is situated in the Mukim of Tanjung Kupang, District of Johor Bahru, Johore as shown in the Gazette Plan PW50276 deposited in the Office of the Director of Survey and Mapping, Johore.
2 The Iskandar Regional Development Authority is the authority established under the Iskandar Regional Development Authority Act 2007.

This article/alert contains general information only. It does not constitute legal advice nor an expression of legal opinion and should not be relied upon as such. For further information, kindly contact skrine@skrine.com.

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